According to figures for May from the Council of Mortgage Lenders (CML), not only is borrowing up across the board, but there has been a “marked increase in lending to first-time buyers”.

In May a total of £8.4bn was borrowed for buying a home, representing 57% of the overall market. The rest was made up of 27% for remortgaging, accounting for another £4bn, and ‘other’ lending such as buy-to-let making up a further £2.3bn, or 16%, of the market.

First-time buyers accounted for 45% of all loans, which is an increase of 42% on May 2012. This is significantly higher than the figures that we’ve seen since 2007, with the average since then being around 38%.

Help to Buy

This and the fact that there is an increasing number of first-timer buyers entering the market with smaller deposits, could be seen as strong evidence that the government’s Help to Buy scheme is already working.

First-time buyers are also tending to borrow more than in the past, with the average home costing £113,400 in May, compared to £110,000 in April. This appears to be because the average first-time buyer has a higher income this year than they did last.

"Although monthly lending is still running at far less than half its typical monthly level during the peak, there is no doubt that the mortgage market is firmly open for business. Both the borrowing appetite of first-time buyers, and the availability of attractive mortgages for them, have improved markedly since a year ago.

"What is interesting is that, in contrast to some recent assertions, this is happening in parallel with the strengthening buy-to-let market. It is perfectly possible for both the buy-to-let market and the first-time buyer market to improve at the same time, as the evidence clearly demonstrates.

"It is important that the supply of housing steps up, as increased housing supply is a crucial factor in ensuring that housing is affordable over the long term," said Paul Smee, director general of the Council of Mortgage Lenders.

More growth in June figures?

Whilst the figures for June are not due for release until August 20, the CML estimates that the market will continue to see growth, increasing 26% on June 2012. This is the highest monthly estimate that the CML have made for lending since October 2008.

This also means that for the second quarter of 2013, gross lending will be at its highest quarterly estimate since Q4 2008. However, according to a BBC report, whilst this indicates a recovery, monthly lending remains at around half the level it was before the financial crisis.

According to a recent report by the Telegraph, figures from the British Banker’s Association (BBA) undermines this slightly as it says borrowers are exploiting low interest rates in order to pay off mortgages sooner.

Whilst the BBA confirms that new mortgage approvals continue to rise, the numbers made for a “subdued picture” where “higher capital repayment continues to generate contractions in borrowing stocks.”

"Borrowers who can afford to continue to overpay on their mortgages, taking advantage of low interest rates. There is also a reluctance to take on extra borrowing because of the uncertain jobs climate. While lending volumes continue to improve we remain some way off a sustained recovery," Jonathan Harris, director of mortgage broker Anderson Harris said.

(source: The Telegraph)

However, it’s worth bearing in mind that BBA figures only apply to banks, whilst the CML’s data applies to all lenders. What it seems the conflicting figures appear to be showing, is that whilst confidence in the property market it certainly increasing, we’re not completely out of the woods yet.